The sentiment graph shown above is calculated using algorithmic text analysis which classifies a Tweet as positive or negative on a scale from +1 to -1. This analysis is conducted for all tweets related to over 100 cryptocurrencies. Aggregating the sentiment over these cryptocurrencies gives an indication of the bullish or bearish sentiment of the market as a whole.
The sentiment indicator has shown a sharp and sustained increase over the past month, particularly the last 10 days which saw the sentiment climb to a 4-month high at 0.149. This suggests the crypto Twitter sentiment is very bullish, which has been reflected in the positive price action over the past 2 weeks.
The bull/bear indicator is based on quantitative analysis and looks at the change in sentiment rather than the current sentiment level. Moreover, it values changes in positive and negative sentiment asymmetrically, reflecting the fact the negative news (FUD) spreads faster than positive news. Looking back the indicator has made some interesting correlations particularly between mid-May to mid-June. The indicator spiked to bullish over the last couple days which preceded the ongoing bitcoin rally. At the time of writing bitcoin is up 4.54% at $6,652. For more frequent updates on sentiment visit AltcoinAnalytics.
Sentiment on crypto news websites also shows some increase, though not as steep as indicated as above. This also reflects the fact that websites are more neutral relative to the general public.
Individual Crypto Sentiment Valuation
The bars show the score of a cryptocurrency relative to its market cap. For example, it is expected that Bitcoin will have more Twitter exposure compared to smaller coin. Therefore, all indicators are scored relative to the respective market cap size. This is then transformed in to a Z-score, which essentially ranks how a cryptocurrency is ranking in its asset class. The four charts show;
- Most exposure (Tweets * followers) relative to market cap
- Most positive sentiment (sum of positive Tweets minus negative tweets) relative to size
- Most Tweets relative to market cap
- Most positive average sentiment
Syscoin (SYS) scored highly with its exposure and its sentiment which was a result of the Binance hack which led to a Syscoin trade of over 96BTC/SYS. Power Ledger (POWR) is up 6.72% since the analysis was conducted and it ranked in the top ten for exposure, sentiment and total number of tweets compared to market cap.
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